Is Microsoft Smartphone Strategy Actually Effective?

Microsoft smartphone business is sinking resulting in a restructuring plan.

Microsoft Corporation is all set to encounter a restructuring plan in terms of its phone business. That will result in the layoff of almost four fifth of the workforce at Nokia where they wish to establish themselves as the industry giant. The company’s core strategy at this point of time is to embrace a turnaround.

The plans to undergo a restructuring plan were announced by the company recently which encompasses a layoff of 7,800 individuals that will belong to the phone business division. Microsoft products have now chalked out its niche audience where it wishes to target those users “business users, cost-conscious customers, and Windows lovers.”

Under the able leadership of Mr. Satya Nadella, the chief executive officer of the company a second round of layoff is likely to take place now. Initially Mr. Nadella bid farewell to almost 18,000 employees.

The tech behemoth is all set to jot down the overall worth of the company’s Nokia handset division which they acquired earlier for an amount of $7.6 billion. Moreover, it has also been estimated by the company that an amount of $750-850 million will be spent for restructuring purposes.

According to Bloomberg, Mr. Nadella wrote an email for the employees that stated, “We are moving from a strategy to grow a standalone phone business, to a strategy to grow and create a vibrant Windows ecosystem including our first-party device family. In the near-term, we’ll run a more effective and focused phone portfolio while retaining capability for long-term reinvention in mobility.”

This strategy by the company is aimed to establish itself as a key player in the phone business unit that will streamline the focus and Microsoft where they will target a limited consumer base. This was the strategy earlier in order to sell the company’s tablet division.

The strategy he used to sell the tablets as that they reduced the range of targeted users in order to become popular which eventually helped them embrace growth where revenues soared substantially and profits also increased to a great extent.

The new strategy by Microsoft seems to come at a relatively critical time frame. The acquisition of Nokia did not really prove fruitful for them since that time there sales have declined substantially. The aim behind this acquisition was to penetrate Microsoft Windows operating system. However, it failed to do that miserably to do so.

So now this will not only help Microsoft redeem its position as a smartphone maker but will also bolster Windows.

Microsoft To Increase The Prices Of Its Cloud Computing Platform

Microsoft Azure during relatively well with its cloud computing platform.

Over the past couple of years, cloud computing has gained significant momentum where many cloud service providers have modified their technologies along with offerings so that they can sustain in the industry. Moreover, prices have also slacked drastically so that the consumption rate increases. Microsoft Corporation, Google Inc., and Amazon Inc. are few of those companies that has reduced the prices of their cloud computing platform earlier. However, now the software maker has decided to increase the pricing of its cloud computing platform.

Microsoft Azure is MSFT’s cloud computing platform that has been designed by the firm to deploy, develop and look after applications and services across a global data center network. These platforms are either hosted by the company’s partners or they manage it themselves. This platform has the ability to support third-party apps along with various tools and programming languages. The platform was launched earlier in 2010 and was known as Windows Azure, but later it was renamed to Microsoft Azure.

This news was put forward by The Register once they got hands on a Microsoft official to discuss their cloud computing platform. This spokesperson talked about how this platform is now being recognized and used globally where the rate of adoption fluctuates from country to country. So the company actually chalks out its strategy according to the region in which it is operational.

He further added, "The Company continues to evaluate the market conditions in the countries in which we operate. As a result, we will be adjusting the prices for the company’s enterprise cloud services in Australia, starting 1 August 2015.” These changes will be implemented across the globe.

These plans by the company were publicized when Mr. Aidan Finn a renowned blogger got access to the company’s emails from which excerpts were extracted and posted on a website. According to the blog, a 13 percent increase is observed in the prices of Eurozone along with a 26 percent increase in the Australian region.

This clearly highlights that the company has been successful in making its niche market where growth rates show that the company has potential to further increase its market share across the globe.

It is a known fact that Azure is one of the top notch Microsoft products and a leader in the cloud computing domain. The company has become extremely competent and is now on par with the cloud computing service of Amazon Web Services and Google. The company has more room to prosper in the times to come.

Microsoft Surface Phone To Be A Game Changer

Microsoft's restructuring will help in their smartphone, cloud computing and Internet of Things domain.

The chief executive officer of Microsoft Corporation, Mr. Satya Nadella has made a big change in the structure of the company where he has bid farewell to almost 7,800 individuals belonging to Microsoft’s mobile phone department. He has also written off $7.6 billion for the acquisition of Nokia which was made under the leadership of Steve Ballmer.

“We are moving from a strategy to grow a standalone phone business to a strategy to grow and create a vibrant Windows ecosystem including our first-party device family,” Stated Mr. Nadella. So now the company will strategize and focus on more targeted markets. This encompasses three types of consumers like the ones who are still loyal to Windows, customers who are cost conscious, along with enterprise consumers.

This way the company is creating their demand in the market where Surface Pro will also play a significant role. Microsoft Windows has to deal with immense competition since Apple Inc.’s iOS and Google Inc.’s Android have a strong share of the market.

At this point, another issue which MSFT is dealing with is that app developers are not interested in developing applications for the ecosystem since iOS and Android are more money making. So it is a relatively sane decision which Microsoft is making since it cannot compete with the likes of iOS and Android.

However, with the launch of Windows 10 scheduled for July 29 will ensure that connectivity for users occurs on various hardware devices allowing Microsoft to have a circuit feasible for smartphones. Microsoft focus at this point is to come up with smartphones, bolster its cloud computing domain and Internet of Things to make its mark in the times to come.

So now their primary focus should be to make these services work smoothly so that they can ensure a connected life. Previously the company did relatively well with the Surface hybrid so now a Surface phone makes sense since they will use their expertise to gain customers/

The company has also revealed that a "Universal Windows Platform Bridges," which will assist developers to port applications present on other operating systems so that they work on Windows.

This is a great step taken by the company to bolster its services and make smartphones that also follow a similar format. Mr. Nadella has insights which are benefiting the company to a great extent. However, now they are required to take bold steps that will help them to sustain and fight back to redemption.

Intel Expected To Post Poor Results

Intel will be posting disappointing results ahead of its official announcement on Wednesday.

Intel Corporation is all set to announce its earnings for the second quarter. It is believed that the company might disappoint analysts and investors and shareholders once the results are out. There is no doubt in the fact that the PC market has faced a major downfall recently and it has not recovered yet due to the rising demand of laptops and other smart gadgets. Hence, the declining PC market will have a great impact on the second quarter earnings of the company.

According to sources, Intel will be releasing its second quarter earnings result on Wednesday in the after market hours. However, expectations still are that the company will post poor results and this will be because of the weak personal computer market. Intel was one of the main companies that used to manufacture and supply its chips for personal computers, therefore, the decline of PC market has to be the reason of poor results of Intel.

According to a source, “The chip maker had initially guided for flat PC unit sales, but then lowered it to mark an expected 5% year-over-year decline.” The company worked and hoped that it will soon recover for its losses. Furthermore, it was also hopeful to make it up for the downfall in the sales of personal computers and cover it up with the sales of data centers. Intel’s data center sales will be increasing by more than 15 percent when compared to last year. However RBC, a research firm, stated that the PC sales of the company will be further down by 8 percent when compared to the sales it made last year.

The semiconductor chip maker will also post a decline in GAAP Earnings per Shares. It is said that the company will experience a decline of 8.60 percent after posting a $0.50 earnings per share in the second quarter of 2015. Moreover, the overall sales of the company will also be reflecting a major 5.5 percent year on year decline as the sales will be worth at $13.07 billion.

Sources suggest, “The company has an average earnings surprise ratio of 15.51%, and has demonstrated a 4.09% increase in earnings during the last five years. Its sales have climbed up 6.12% since then and have an average surprise ratio of 1.44%.”

So far, the company has posted mix results in the second quarter as it surpasses the expectations of The Street by a mere $0.01. The company managed to post a GAAP earnings per share of $0.41.

China Is A Difficult Market For Microsoft And Sony Gaming Consoles

Microsoft is optimistic about its gaming console market in China.

Sony Corp and Microsoft Corporation have been keeping a close watch on the Chinese market since the country raised its ban from video gaming consoles. Both the companies were extremely spontaneous about launching their gaming consoles in the Chinese market. However, the response has been relatively disappointing so far.

According to a recent report published by Niko Partners clearly highlights that Microsoft Xbox One and Sony PlayStation 4 will not be able to do quite well in China at least this year. As estimated the accumulative sales of Microsoft and Sony’s gaming console is said to be 550,000 units by the end of FY15 as estimated by the company.

The company has suggested that these firms need to come up with more high budgeted and high-quality AAA games so that sales boost in the region. Currently the list of games being offered in the Chinese gaming market are extremely narrow and many big games like the Call of Duty it yet to be launched.

Another reason why these gaming consoles did not do quite well is that the Chinese market has more gamers interested in PC gaming where these consoles are extremely expensive for them. Ironically, the Xbox is priced at $607 in the Chinese market which is $200 more than the US pricing.

On the other hand, Phil Spencer of Microsoft is optimistic about this venture where a conference for gaming is scheduled in China for the coming month. Microsoft seeks to capitalize on the conference where they hope that they will engage more gamers. Moreover, the report also claims that the sale of smart TVs will also supersede the sales of gaming consoles FY19. The reason behind this is that smart TVs have various functionalities, they are cheaper and also have several games available on them.

The founder and managing partner of Niko Partners, Ms. Lisa Cosmas Hanson mentioned, "Despite China being a predominantly PC online gaming culture, Chinese who are now 26-35 years old grew up in the days of Nintendo Super Famicom consoles and are accustomed to playing games with a controller via a TV." Moreover, these gamers will have the ability to adopt OTT games that can be played on this television along with gaming consoles which will transform the living room into an entertainment station.

Hence in a nutshell, despite the criticism Microsoft is still optimistic about this venture and believes that they will soon capitalize on the Chinese market for gaming consoles.

Bidness Tech - Halliburton Experiences Decline In Share Value Yet Again

The oil field services provider has yet again experienced a downfall on the index following a decline in the crude oil prices.

Halliburton Company had been experiencing a much better time on the stock index until recently, when the oil digging firm was seen going down following the dreaded decline in the crude oil price value. In the start of the new financial year, the oil company witnessed a lot of strength in the value of the shares despite the up and down stance adopted by the oil prices. However, around a week back, the price of crude oil fell by a massive difference that left no choice for the oil field services providing firm but to have its shares see a dip as well. It is not a hidden fact that the shares of the oil giant has an unavoidable connection with the fluctuating value of crude oil and this has been shown quite evidently in recent times.

On the other hand, analysts who have been looking at Halliburton stock closely are now shifting their opinions from overly bullish to bullish in the researches being made by them. Furthermore, the oil digging company has been reflecting some positive factors, which is why it is being seen in a bullish manner by the analysts. First of all, the fact that the firm has the dividend rate set at a value of 1.6 percent is showing signs that are not being ignored by the analysts and according to them, this shows that the value of the firm stands currently at quite a high rate.

Moreover, the market cap value of the oil company has last been recorded at a value of $36.69 billion while on the other hand, the enterprise value of the firm stands at a massive evaluation coming around at $42.80 billion. The price to sales ratio has been reported to the industry at 1.14 while the price to book ratio has been much higher, coming around at 2.37.

The price to earnings ratio, on the other hand, was last seen at 23 and where the EPS is concerned, the estimations of the analysts and equity firms are around 32.4 percent for the upcoming year. As long as the cash returns are concerned, the firm has a strong return on assets at 9.59 percent.

On the other hand, the bearish view of Halliburton is also something that cannot be ignored by the investors. Currently, the oil firm receives around $2.36 billion in the form of revenue whereas currently, the debt that the company is in stands at around $7.84 billion. This has made around twenty-five equity firms grant a ‘buy’ rating to the oil company.

Baird Reports That The Future Of Google's Cloud Computing Is Promising

Google Cloud Computing has ample growth potential reports Baird.

Google Inc. has been accelerating its effort to bolster its cloud computing business in order to give a tough time to Microsoft Corporation and Amazon.com Inc. both of which are playing a significant role in shaping the cloud computing space. Despite the fact that Google’s cloud computing platform is in its initial stage its future is still promising. The reason behind this assumption is that the company is making several innovations on a rampant pace.

Baird Equity Research, the popular Investment firm in an updated note provided to investors and clients appreciated the search engine giant’s effort to bolster its cloud computing space.

The company while visiting Google Nest – where a great chunk of Google’s cloud computing is housed observed two major things. Firstly, analysts at Baird were enthralled to see that the company is extremely open about its cloud computing division. Google has opened a great chunk of its cloud and networking infrastructure to third party app which is an uncommon practice when it comes to enterprise service.

Secondly, the cloud computing division of Google is technologically linked to their core business similar to Amazon. So if they start to use this as an advantage, the company will be able to direct their enterprise clients in an effective manner to certain of its services which is relatively difficult for other companies to accomplish.

Baird also took into consideration that the company provides testimonies from a few of their top notch high profile clients which includes JDA software, PricewaterhouseCoopers along with SunGard Financial Systems so that they can prove that its cloud computing platform is extremely capable. Apart from that the company has many big names like HTC, Best Buy, Coca Cola and General mills as its enterprise client.

However the only reason why Google is not doing relatively well is due to the technological loopholes in its system. But many analysts believe that the company’s aggressive pricing strategies along with its open nature of the cloud computing business can overcome the shortcomings its dealing with currently.

According to BidnessETC, “Baird notes that during the event Google management shed light on the superior economics of sustained use discounts for its compute engine in comparison to Amazon Web Services’ elastic compute.”

Google at this point also stated that it wishes to containerize its cloud computing division so that the developers can move application on various cloud architectures. Thus Baird at this point believes that the company has potential in cloud computing all it needs to do is work on the shortcomings.